FBLG Banking Letter - October 2018 Edition

2018 Independent Bank Compensation Survey

Generic Reports available online, Custom Reports coming soon!

We have completed the 30th anniversary edition of our annual Independent Bank Compensation Survey. The 2018 survey is based on 246 responses from community banks in 33 states. This survey provides valuable compensation analysis, including:

Executive staff with key operations, lending, IT and compliance positions.

IRS Clarifies How to Accurately Deduct Meals

The Tax Cuts and Jobs Act limits the itemized deduction for state and local taxes (SALT) to $10,000 annually for taxpayers with a filing status of married filing jointly. In response to the Act, some high-tax states have created workarounds that attempt to re-characterize payment of SALT as a charitable deduction by providing substantial tax credits for “donations” to certain “charities”. The IRS has responded with proposed regulations.

Updates on the Treatment of Reciprocal Deposits

In September, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency (the “Agencies”) issued a notice of proposed rule on the treatment of reciprocal deposits. The proposed rule would conform to the FDIC’s current regulations and changes to Section 202 of the Economic Growth, Regulatory Relief, and Consumer Protection Act.

The main effect of the proposed rule is to permit FDIC insured financial institutions, to except certain amounts of reciprocal deposits from treatment as brokered deposits under certain circumstances.

How to Appeal to Millennials: Offer Pet Benefits!

The millennial generation currently makes up around 35% of the work force. They’re the most well-represented generation among workers today and could make up 75% of the work force by the mid-2020’s. How does one attract this tech savvy group to their bank? Millennials have some unique demands of potential employers.

More Time to Prepare if CECL Deadline Extended

To address areas of uncertainty brought on by stakeholders, the Financial Accounting Standards Board (FASB) met in August and issued a proposed accounting standard update that would amend the transition requirements for non-public community banks.

Under the current guidance, implementation for the Current Expected Credit Loss (CECL) model is required for fiscal years beginning after December 15, 2020. With the proposal, this date would be pushed back to fiscal years beginning after December 15, 2021, resulting in a January 1, 2022 implementation date for fiscal year-end community banks.